Ireland's engine of growth stalls

The Celtic tiger appears to have stopped roaring. IT firms that had fuelled Ireland's growth are falling to earth as quickly as they sprung up.

As well as the bad news from internet security maker Baltimore, telecoms company Telabs announced that it was closing its plant in Drogheda with a net loss of around 150 jobs.

Other high-profile setbacks for the sector include the loss of 900 jobs at US computer maker Gateway, 650 by the end of the year at General Semiconductor, which supplies components for personal computers.

Investment Development Agency Ireland, which looks after foreign investment in Ireland, reckons that around 4,500 jobs have gone in the information and communications technology sector so far this year - though a further 2,500 have been created. The worst of the impact appears to be falling on the manufacturing sector, rather than services or research and development, an IDAI spokesman said.

"Now that the hit from the US is spreading to Europe we are beginning to get hit at the low end of the industry."

But he said the response varied from sector to sector though a ban on new recruitment appeared to be "a wide spread pattern".

But he said that while information technology and communications were being affected foreign investment in other areas such as pharmaceuticals and financial services were continuing to grow.

"We are confident that we are not going to lose out - we expect to see [investment] growth of between 3% and 5% this year," he said.